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7 HR considerations to make before launching your startup

Posted by Shivali Anand

July 16, 2021    |     6-minute read (1029 words)

When it comes to starting a business, entrepreneurs have many choices to make, and one of the most crucial is whom to hire. It is not unusual for a new business to begin with simply the entrepreneur, but a team of employees may also be brought on board. Even if the company only has three or four employees, the founder should consider hiring an HR team to protect the business by keeping it in compliance with federal, state and local regulations and by reducing liability risks.

To manage workplace culture, payroll and employee benefits, business owners might engage an on-site HR staff or opt for outsourced HR professionals. If you're a startup founder with limited resources, outsourcing HR services can help you get more bang for your buck. Whether on-site or outsourced, HR professionals can develop policies and procedures for hiring, training, retaining and evaluating personnel, as well as keep your business organized as it grows.

To offer a fantastic employee experience, boost employee productivity and attract top talent, check out this list of HR aspects you must consider before getting started.

Determine the salary and benefits of your employees.

Some benefits are voluntary, while others are mandated by legislation. Dental, life insurance and 401(k) plans are among the optional perks. Workers' compensation and disability insurance are examples of mandatory benefits that vary by state. As you develop your HR team's program, you may start with the following advantages


Based on labor market trends, ensure your company's compensation structure is competitive and fair. Your HR staff should collaborate with your accounting team to create an effective employee compensation structure, as well as a fair cost reimbursement procedure.

Health and care benefits:

Examine the possibilities, as well as what your rivals are offering and what you can afford.

Leave policies:

Before offering paid sick, vacation or maternity leave to your employees, you must also look into applicable federal and local regulations that may apply.

Other perks

: Prioritize your employees' needs before choosing incentives like free lunches, complementary dry cleaning, transportation and retirement plan contributions. As your firm grows, try to improve and evolve these advantages.

Define the workplace culture

While every firm has a goal, employees also choose companies that are value-driven. Make strategic decisions about your work culture depending on your company's needs, such as flexible working hours and remote work alternatives.

Your HR staff may assist you in developing a code of conduct, establishing limits and expectations of behavior, properly communicating corporate rules and ensuring that your employees abide by the procedures. Establishing workplace protection rights will assist you in maintaining your company's culture as you expand. Define your company's fundamental principles and foster a culture of and openness.

Invest in an HRIS (human resource information system)

Entrepreneurs may use an HRIS to keep track of employee time, handle payroll and benefits, automate administrative chores and preserve records, among other things. There is plenty of reasonably priced software to help you stay organized as your company grows. To evaluate which tools might benefit your firm, consider its size, payroll needs, industry and budget. If you're short on cash, concentrate on the fundamentals and choose an HR software solution that can help you simplify your processes and avoid costly blunders.

Develop policies to ensure compliance, safety and health

Specific rules and regulations govern how and when your workers are permitted to work. If you don't have an HR staff in place, noncompliance with these rules might expose you to liability concerns. To provide a better employee experience and minimize your company's liability, it's critical to develop nondiscrimination rules and employee conduct standards.

HR rules and procedures should be tailored to the specific demands of your company. You should include corporate rules on: 

  • Ethics - Emphasize to your workers the importance of ethical behavior. This covers rules on equal employment opportunity and sexual harassment in the workplace.
  • Job at will - Make it clear that both employee and the employer have the right to void the employment agreement at any point.
  • Changes in policy - Keep in mind your firm has the authority to modify its rules at any time.
  • Safety plan - Ensure your workplace is safe for employees, that it conforms with federal and local standards and that it complies with the Occupational Safety and Health Act.
Creating a safe and healthy workplace that complies with federal, state and local regulations gives your firm legal protection and leads to happier employees. Rules often change, which is where an outsourced HR staff can assist. To ensure that your business grows smoothly, make sure you remain on top of changing requirements.

Procedures for recruiting, onboarding

Even if your company is tiny, think about how you will make recruiting decisions. This informs where you’ll post job opportunities, identify qualified individuals and manage the onboarding process. Your human resources department must establish fair recruiting, training, promotion, salary, benefits and performance evaluation procedures. To guarantee that the recruiting and onboarding process is nondiscriminatory, entrepreneurs should have a basic HR plan and required documents available. To address employees' issues, create a method for collecting employees' input.

Create training programs and methods for performance evaluation

Hiring and keeping top leadership talent is the first step in building a successful organization. Employee training may not be your top concern when you're just getting your firm off the ground. However, as your firm grows, make sure your staff continue to learn and expand their talents. This may be achieved by keeping track of employees' objectives and developing a performance appraisal system. Make sure you understand the HR strategies and finances to set a timeframe for implementing each activity.

Make a handbook and follow it.

An employee handbook explains the type of culture you want to establish by defining policies, procedures, processes, benefits and more. It ensures that employees and employers are on the same page and that the policies are not misunderstood. The handbook will also assist you in responding to employee inquiries that might otherwise consume important HR time. Creating a manual in the early stages of your business can set you up for success and will assist you in resolving workplace disagreements.

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